EU Delays Plan to cut Price of Sugar

Agriculture Minister, Roger Clarke, has said that the proposed 37 per cent price cut on sugar put forward by the European Union (EU) last year, would not be implemented on July 1, 2005 as was originally suggested but in July 2006. Speaking at his Hope offices in St. Andrew recently, the Minister said that the postponement of the proposed cut was as a result of lobbying efforts being undertaken by the African Caribbean and Pacific Countries (ACP), the Caribbean Community and his Ministry in collaboration with the Sugar Industry Authority (SIA). The extent of the cut that will be made next year, is however, not known at this time, as the Minister indicated that the ACP states were still lobbying for modifications to be made to the EU proposal. The EU had initially proposed a 37 per cent reduction over a three-year period, beginning with a 20 per cent cut on July 1 and another 17 per cent reduction applied over the next two years. Notwithstanding the postponement, Minister Clarke said that CARICOM remained adamant that there should be no price cuts until 2008, consequent on the review of the Cotonou Treaty in 2006. Ambassador Derick Heaven, Executive Chairman of the SIA, told JIS News that CARICOM, along with other ACP countries, had proposed a five per cent cut in 2008, and that any remaining cut be phased in over a 10 year period. He said that CARICOM, by its lobbying efforts, should not be viewed as mendicants “who are going to Europe with a begging bowl”. CARICOM’s stance, he pointed out, was in fact consistent with the 2000 Cotonou Treaty, which signalled that no changes would be made before 2008. Ambassador Heaven noted further, that the efforts of the ACP countries to prevent the EU from going ahead with its proposal was in fact within their rights, as Europe broke an agreement, and coined their own, before consulting with the ACP partners. “I would like the Europeans to see and recognize their responsibility, while effecting what they regard as necessary change, to have dialogue with a partner, who has a firm treaty with them and who has been a reliable partner in guaranteeing supplies as they have been contracted,” Ambassador Heaven stated.Furthermore, he pointed out, a 37 per cent price cut was unnecessary, and if implemented as proposed, would have devastating effects on the economies of ACP states as well as their suppliers. Jamaica earns approximately US$100 million per year from sugar exports and the cut would result in a loss of some US$37 million in annual earnings and significantly affect rural families, a number of which were heavily dependent on the sugar industry for their survival. With regard to taking legal action against the EU, as was suggested by Minister Clarke in October 2004, Ambassador Heaven said that this option, though not entirely ruled out, would not be taken by the ACP states at this time.